Was the past week trying for you as a trader?
continuously, striking fear into the hearts of many.
Is it time to sell all your holdings and run away?
I think that it’s time to look at stocks in the defensive sectors as they are silently creeping up in price.
Last week, I’d shared about a swing trading opportunity on the shares of Ross Stores (ROST).
Its share price continued to fall, so there’s no entry based on The Art of Explosive Framework.
Our swing trading opportunity this week comes from the utilities sector.
The utilities sector has been showing strength by rising in value when the overall US stock market was dropping.
So, let’s jump in and analyze this week’s swing trading opportunity, NextEra Energy, together!
Performance Of US Stock Market vs NextEra Energy (NEE)
The very 1st step is to compare the share performance of NextEra Energy against the S&P 500.
You can tell that the S&P 500 has been outperforming NextEra Energy’s shares.
On a closer look, do you see that as the S&P 500 continued to slide, the share price of NextEra Energy started to rise in early Oct 2023?
Yes, the shares of NextEra Energy are in a fresh uptrend, and this could continue.
Therefore, you’ll want to continue analyzing its shares for a swing trade.
How Explosive Is NextEra Energy (NEE)?
At this stage of analysis, you’re looking out for the tendency of NextEra Energy’s shares to explode upward in price.
This is a critical step because time is of the essence. You don’t want to be holding a lethargic stock when there are many other stocks that you could be profiting from.
I’ve marked out the explosive moves that NextEra Energy’s shares have made to save you time.
NextEra Energy’s shares have exploded upward 11 times in the past 8 months. Its smallest stands at 4.4% while its largest stands at 13.2%.
For a defensive stock with a market capitalization of close to $114b, these moves are remarkable!
Ok, so this stock is explosive.
Is it a great time to buy its shares for a swing trade?
Let’s find out in the next step of analysis.
Key Price Levels
To determine whether the shares of NextEra Energy are ready for a swing trade, let’s uncover its key price levels.
Before looking at the chart of NextEra Energy above, could you tell that there’s a support area at ~$55?
Yes, key price levels are also known as support and resistance zones.
Because the share price of NextEra Energy is pulling back, it’s likely to drop to around $55 before bouncing and heading higher.
Therefore, I’ll be watching this support zone closely before taking action.
The Strategy You Can Use To Swing Trade NextEra Energy (NEE)
After comparing the performance of NEE with the broader US stock market, determining whether NEE has experienced explosive up moves, and identifying its key price levels, it’s time to talk strategy.
To stay in business, you must know your entry, profit-taking, and stop loss levels in every trading strategy. Yes, trading is a business, which means that your strategy must be well thought out.
Using The Art of Explosive Profits (AEP) framework, I’d like to see NEE pullback and bounce at $55 before considering an entry for a swing trade.
As the name implies, you’ll be looking to consistently catch an explosive move in a short period of time.
Instead of relying on news and hearsay, the AEP course will teach you how to screen stocks for swing trading like NEE.
You’ll also learn how to read charts and identify stocks that are about to make a big move.
Finally, you’ll learn how to identify the optimal entry, stop loss, and take profit levels to capitalize on these explosive moves (in a safe manner, of course)!
Can you apply the AEP framework to provide you with a side income while working full time?
Yes, you can!
Come, have a look at the AEP framework and incorporate this explosive trading strategy into your arsenal to capitalize on more swing trading opportunities.
Why Is Swing Trading NEE Worth It?
Source: nexteraenergy.com
Stocks in the defensive sectors are holding up well while the S&P 500 declines. NEE is rising in the midst of this decline.
Knowing that investors are shifting their money over to NEE, we further analyze NEE.
NEE is capable of explosive upswings despite its huge market capitalization. The largest upswing took place just last week, measuring 13.2%!
After this huge move, I think that it’s about to pullback, presenting a fantastic swing trading opportunity that you’ll want to pay attention to.
While you wait for the setup, please keep in mind that I’m not a financial advisor, so please treat this as infotainment and conduct your own research.
Lastly, all images are from pexels.com, pixabay.com, sectorspdrs.com, tradingview.com, and unsplash.com.
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